Friday, June 24, 2011

A Whirlpool Corp. (WHR) subsidiary agreed to pay about $603 million to settle all claims related to a long-standing dispute in Brazil with Banco Safra SA, leading the household appliance manufacturer to trim its full-year earnings outlook.

Whirlpool, whose brands include Maytag, KitchenAid and Amana, now expects to report earnings of $8.30 to $9.30 a share, including the costs related to the settlement. The guidance without the charge had previously ranged between $12 and $13.

The company said the settlement related to the enforceability of an unauthorized loan entered into in 1989 by an employee of Embraco, which subsequently became part of Whirlpool's Brazilian business, and who was terminated that year.

The agreement, subject to the approval of a Brazilian court, would result in Whirlpool paying the Brazilian bank about $295 million in the third quarter and $308 million in the first quarter of next year.

Whirlpool said it would record an additional charge of about $439 million in the second quarter to reflect the full amount of the agreement. It expects to fund the settlement with available cash.

"After fully considering all the circumstances, the uncertainty and potential outcomes, it was a prudent decision and in the best interest of the company and its stockholders to settle this case now," said Chairman and Chief Executive Jeff M. Fettig.

PRISON RADIO

The River Goes By - Philip Bassett

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BANCO online archive

Rev. Edward Pinkney - How BANCO Started:

"Many years ago I was going about my life believing that the justice system was just that until I started going to the court house to observe all the wrong convictions. There are numerous factors for wrongful convictions in the Berrien County court system. Most of the problems are in the local judicial system."

"It's hard to believe that in the year 2012 we have a county in Michigan with a legal system this antiquated and racist. What's harder to believe is that no one at the State or National level is taking any action to remedy the situation."

"We cannot run society for the privileged and allow a significant proportion of the population to be marginalized. It impacts the quality of life for all of us. If we have throwaway people, a justice system which tolerates injustice is doomed to collapse. I am truly ready for action."